What will happen when interest rates rise?

midnight_child

Thrugelmir wrote: »

The unknown is the rump of poor lending that was made between 2002 -2007. With many still sitting on interest only deals or letting their property out.

And many from the later end of that timeframe will have negative equity to boot, so very few options available.


This was one of the things that really intrigued me, as most people in financial difficulties you think would prioritise the mortgage over other payments. It may not be obvious how many are currently meeting their obligations, but are only just keeping heads bove water. This would not show up in repossession or arrears figures.

CLAPTON

midnight_child wrote: »

And many from the later end of that timeframe will have negative equity to boot, so very few options available.


This was one of the things that really intrigued me, as most people in financial difficulties you think would prioritise the mortgage over other payments. It may not be obvious how many are currently meeting their obligations, but are only just keeping heads bove water. This would not show up in repossession or arrears figures.

what's quite intriguing is why you are so determined to find a significant downside of falling unemployment, increasing incomes, rising GDP, falling bankruptcies etc

midnight_child

Not determined to find anything, just curious what will happen in the coming months/years.


I've not got much more to add here, so lets pick this discussion up say 3 months after the first rate rise, whenever that may be.
















Maybe you will be correct and this turns out to be the biggest non-event since people were panic buying in case they caught the millennium bug.




If this is so please feel free to gloat mercilessly.

Thrugelmir

midnight_child wrote: »

This was one of the things that really intrigued me, as most people in financial difficulties you think would prioritise the mortgage over other payments. It may not be obvious how many are currently meeting their obligations, but are only just keeping heads bove water. This would not show up in repossession or arrears figures.

Mortgage rates are at record lows. Which is probably a blessing to those who are financially stretched. As interest rates rise then most likely will the level of personal insolvency will increase (very low at the moment).

CLAPTON

midnight_child wrote: »

Not determined to find anything, just curious what will happen in the coming months/years.


I've not got much more to add here, so lets pick this discussion up say 3 months after the first rate rise, whenever that may be.
















Maybe you will be correct and this turns out to be the biggest non-event since people were panic buying in case they caught the millennium bug.




If this is so please feel free to gloat mercilessly.

no memory of people panic buying

wymondham

Interesting statistic in here - more than 1 million homeowners have never known a rate rise!! Given people usually prepare for the expected, then this could be a sizeable amount of people who didn't plan for a rise...

http://www.bbc.co.uk/news/business-33786528

ukcarper

wymondham wrote: »

Interesting statistic in here - more than 1 million homeowners have never known a rate rise!! Given people usually prepare for the expected, then this could be a sizeable amount of people who didn't plan for a rise...

http://www.bbc.co.uk/news/business-33786528

Won't the majority of those have been subject to the new lending criteria.

padington

wymondham wrote: »

Interesting statistic in here - more than 1 million homeowners have never known a rate rise!! Given people usually prepare for the expected, then this could be a sizeable amount of people who didn't plan for a rise...

http://www.bbc.co.uk/news/business-33786528

China just devalued their currency by 1.9% ..... Personally think a rate rise isn't on the cards and the cards arnt even in the room and the room hast even been built yet.

CLAPTON

wymondham wrote: »

Interesting statistic in here - more than 1 million homeowners have never known a rate rise!! Given people usually prepare for the expected, then this could be a sizeable amount of people who didn't plan for a rise...

http://www.bbc.co.uk/news/business-33786528

about 26 million are benefiting from rising employment and higher wages

Mistermeaner

I might get a new car